(RTTNews) - The Swiss SVME purchasing managers’ index or PMI dropped to 54 in October from 54.3 in September, a report from Credit Suisse showed Monday. Economists had expected an increase to 54.9.

A PMI reading above 50 suggests expansion in activity, while below 50 suggests contraction. The SVME PMI reading stood above 50 for the third month.

“This is certainly good news for the industrial sector as the production level at the beginning of the summer was still hovering near its 2006 level,” ING economist Julien Manceaux said. However, the economist warned that there is a doubt that investments will see a strong rebound as capacity utilization remain historically low and employment growth is still weak.

Among the sub-indexes of the PMI, the suppliers delivery times climbed to 57.3 from 54.4, the quantity of purchase index rose to 57.6 from 57.2, the stocks of purchases index improved to 45.2 from 42, the stocks of finished goods index increased to 44.9 from 41.4 and the employment index moved up to 42.4 from 42.1.

At the same time, the output index dropped to 60.6 in October from 62 in September, the backlogs of orders fell to 57.7 from 60.1, the purchase price index declined to 52.2 from 53.2.

Manceaux said the still fragile recovery combined with lingering deflation will ensure that the current expansionary monetary stance will remain unchanged until the second half of next year.

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Posted in Categories: Economy, Releases, Switzerland.

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